Bloomberg Pledges $500 Million to Close All Coal Plants

Acclaimed billionaire and former New York mayor, Michael Bloomberg, has promised to donate $500 million towards efforts to close all coal-fired power plants. Beyond the large sum, Bloomberg’s announcement has raised eyebrows thanks to his decision to simply ignore Washington and focus instead on state and local politicians and lobbying.

Bloomberg’s pledge

Michael Bloomberg, the billionaire former politician, announced in early June a pledge of $500 million towards a new campaign, Beyond Carbon, designed to help close all coal-fired power plants in the U.S. by 2030, as well as stunt the growth of natural gas, thus helping the U.S. move towards a fully renewable energy sector.

The campaign focuses exclusively on local and state politics, bypassing the federal government completely, which Bloomberg says can’t seem to find the gas pedal around climate-progressive policies, thanks to the country’s current president.

When he announced the donation, Bloomberg himself said:

“We’re in a race against time with climate change, and yet there is virtually no hope of bold federal action on this issue for at least another two years. Mother Nature is not waiting on our political calendar, and neither can we.”

The funding will support environmental groups’ lobbying efforts in state legislatures, city councils, and utility commissions as well as efforts to elect lawmakers who look favorably on clean energy.

No matter the individual or amount, Bloomberg’s goal is a tall order. As of 2017, there are still 359 coal plants operating in the U.S. and coal still accounts for about 30% of all electricity generation in the country. In some states, that number falls closer to 100%. Closing every coal plant in the U.S. in just over 10 years is a huge endeavor.

Image Source: Data from EIA, Graph from Solar Tribune

With a sea change this large, $500 million is just a drop in a very large bucket. However, by donating to pro-clean energy lobbying and campaigning, Bloomberg is funding the individuals and organizations that he hopes will move the U.S. forward on climate change policy. In essence, he’s buying the fishing pole and hoping others will catch the fish.

States moving forward on clean energy goals

If Bloomberg wants to pass serious changes to climate policy, his focus on state and local politics is certainly in the right place. The fact that a billionaire former-politician feels he must circumnavigate Washington, DC to instigate climate changes shouldn’t come as a surprise.

Since the 2016 election, President Trump has recalled, weakened, or stalled many of President Obama’s environmental policies, including the Clean Power Plan, membership in the Paris Climate Agreement, vehicle emissions standards, and dozens of other emissions and climate-related policies. And with a Congress that is increasingly unwilling to work with the other side, the idea of any climate-positive legislation passing any time soon seems almost unthinkable.

In the absence of any nationwide climate regulations, individual states and cities have taken it upon themselves to help reduce carbon emissions, almost exclusively through clean energy goals.

Seven states and territories – Hawaii, California, Puerto Rico, Washington DC, Washington, Nevada, and New Mexico – have already passed 100% clean or renewable energy goals. The Sierra Club also lists over 90 cities and 10 counties that have pledged 100% goals, with six cities already reaching 100% clean energy.

Image Source: Graph from Solar Tribune

Hawaii, which suffers from some of the highest electricity rates in the U.S., was the first state to pledge 100% renewable energy back in 2015. At the time, the island state was already sourcing 33% of its electricity from renewable sources, so it is already well on its way to meeting this goal by 2045, the mandated year.

In 2018, California – the world’s fifth largest economy – pledged 60% renewable by 2030 and 100% clean energy by 2050. Mandating clean energy, as opposed to renewable energy exclusively, allows some flexibility for utilities to choose from a wider range of energy sources, most importantly nuclear.

Why are climate and clean energy policies so hard to pass?

Regardless of the politicization of climate change, the truth is that coal and natural gas still remain an intrinsic part of the utility industry and – even more importantly – a source of employment for the thousands of Americans who work in coal mines and coal-fired power plants, often in small towns with limited other economic opportunities.

While electricity generation from coal has fallen over 30% since 2009, it still makes up 27% of the nation’s electricity generation. As noted in the following graph, in coal-rich areas like Montana and West Virginia that number pushes close to 100%. And as the U.S. weens itself off of fossil fuels, employment in the coal industry is also falling fast. Since 2009 employment in the coal industry has dropped 40%, from 86,000 to just 50,000 today.

While states like California and Hawaii have embraced clean energy whole-heartedly, that’s certainly not the sentiment everywhere, especially in states with large coal deposits like Wyoming, Montana, West Virginia, and Kentucky.

The importance of coal to both these states’ economies as well as the local population can’t be ignored. To those in the coal industry, replacing coal with renewables is a potential threat to their livelihood, and some states have worked to protect the coal industry from change.

In early 2019, Wyoming passed S.F. 159, a new law that requires any utility looking to shut down a coal-fired power plant to make a ‘good faith effort’ to find a buyer before closing. Once (and if) sold, the new owners aren’t allowed to close the plant early. While some heralded the law as a positive step to protect local industry, others saw it as well-intentioned, but misguided.

Any large-scale move towards renewable energy should take the welfare of these workers into account. When New Mexico passed its 100% clean energy goal in March 2019, it won accolades from the energy industry for its thoughtful, comprehensive plan for the welfare and training of plant and mine workers affected by the clean energy transition. In total, the plan set aside more than $70 million for plant decommissioning, severance, worker training, apprenticeships, and programs to help communities build new economic options.

Closing coal plants shouldn’t be taken lightly; it affects both individual households and the local economy. However, with thoughtful legislation this painful process can actually turn into a positive change, as market forces push coal out.

As the federal government continues to squabble, state and local governments are taking up the challenge. If the U.S. is to make large-scale, nationwide change, we might have to wait two more years like Bloomberg says, but it might take even longer.